Rumors are rife that Taiwan Semiconductor Manufacturing Co. Ltd. and Apple Inc. will be expanding their foundry ties, which is a possible blow for Samsung. According to sources, Apple and TSMC have quietly entered into a foundry relationship. It has been reported that the A5 dual-core processors that Apple uses for the iPad 2 will be made by TSMC on a foundry basis. It has been said that the 40nm processors of TSMC will be used by Apple for the A5 and the company will also possibly work with the manufacturer on 28-nm processors.
This is very likely to be bad news for Samsung who are the producers of the older A4 processors for the original first edition iPads on a foundry basis. Along with the A4, Samsung also produces the processors for the iPhone. However, the position of the company still hasn’t been made clear on whether they will manufacture the A5 processors for Apple.
The A4 and A5 processors have been designed by Apple itself and these have been based on ARM’S technology. According to these sources, there are three possible reasons for Apple to use TSMC for making the processors. First, Samsung is an active competitor for both, the iPhone and the iPad and Apple doesn’t want one of its main competitors producing the most important component for its devices. Second, the 40nm process of TSMC has the highest yield among all the others in the foundry world. And last, the 40nm production capacity of TSMC is the highest in the industry. As the likes of RIM, Samsung and Motorola along with a host of other major manufacturers around the world are selling tablets as well, there are huge concerns regarding the overbuild of components in the tablet space.
